Ocean Cargo: Spot pricing escalates in Asia-U.S. trade lane

Spot prices for transpacific shipping services have grown by more than 180 percent during the past 12 months to reach a five-year high.

By ·

Spot prices for transpacific shipping services have grown by more than 180 percent during the past 12 months to reach a five-year high. Experts describe the increase as a “mini container shipping boom.”

Shipping consultant Drewry’s Hong Kong-Los Angeles container rate benchmark hit $2,607 per 40-ft (FEU) container last week – 19 percent higher than the previous week and 182 percent higher than the same week in 2009.

But Drewry pointed out that the trade had been suffering with “serious overcapacity and price discounting” in 2009.

It added that the jump in transpacific container rates reflected new peak season surcharges, very tight eastbound transpacific ship capacity and a shortage of boxes, which is becoming an issue in China as well as in the US.

Drewry said eastbound transpacific freight rates, under annual contracts signed in May and June for the 2010/2011 season were also more than twice the previous low levels of the 2009-10 season.

“The rebound in spot container freight rates has been phenomenal, as rates now substantially exceed pre-crisis levels of about $2,000 per 40-foot box,” said Philip Damas, dditor of the Drewry Container Freight Rate Insight report, which contains the data.

“Whether you look at Hong Kong-to-Los Angeles, Shanghai-to-LA, Shanghai-to-New York or Shanghai-to-Chicago, all our weekly container rate benchmarks from port to port or from port to inland point show year-on-year increases of more than 60 percent.

“It is a mini container shipping boom, ahead of the full recovery of the real economy,” he added.


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

Ocean Freight · Shipping · All Topics
Latest Whitepaper
Maximizing Your Sales Team’s Effectiveness
Companies need to examine how to restructure their sales team to respond to different customers and subsequent buying behaviors and preferences.
Download Today!
From the November 2017 Logistics Management Magazine Issue
An inside look at how a large pharmaceutical firm transformed its vendor and supplier relationships into true, collaborative partnerships—and greatly strengthened its logistics and supply chain operations in the process.
34th Annual Quest for Quality Awards: 2017 Awards Dinner
Trucking Regulations: Washington U-Turns; States put hammer down
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Make Your Products Smarter in the Supply Chain with the IoT
This webinar explores how temperature-sensing smart labels and inexpensive NFC tags are being used to extend product safety and efficiency beyond the shipping dock while also building a communication bridge to your customers.
Register Today!
EDITORS' PICKS
2017 NASSTRAC Shipper of the Year: Mallinckrodt; Mastering and managing complexity
An inside look at how a large pharmaceutical firm transformed its vendor and supplier relationships...
2017 Alliance Awards: Recognizing outstanding supply chain partnerships
In an era where effective supply chain collaboration is both highly valued and elusive, Logistics...

26th Annual Study of Logistics and Transportation Trends: Transportation at Digital Speed
While a majority of companies strongly agree that transportation is a strategically important...
34th Annual Quest for Quality Awards: Winners Revealed
Which carriers, third-party logistics providers, and North American ports have crossed the service...